‘She relies on the creditors’ goodwill to get out of the situation,’ the source continued. ‘If, at the end of October, they don’t accept her plan to get out of this mess, then she’ll be declared bankrupt.’

That could mean that Katie could be forced to sell her Sussex mansion and downsize.

The former model has been selling her farmyard animals in an attempt to raise some cash, but it hasn’t worked.

CelebsNow has contacted a representative for Katie asking for comment.

The source added: ‘Selling the farm equipment and animals didn’t raise half as much as she thought, as it was rotting out on the field since Kieran left and was badly in need of repairing, which is very expensive and reduces the price.

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